The average person of my generation (ages 55 - 65) has saved about $50,000 for retirement. They will need about $1,000,000 to live comfortably. How are you going to retire comfortably?

Going to live on your Social Security payment? Think again. Remember that Social Security is a poverty program not a retirement program. Social Security will help, but it is not intended to replace a good retirement strategy. Defined benefit (regular monthly payments upon retirement for the rest of your life) retirement programs are mostly gone. Retirement risk has been shifted from firms to the individual. Most people will need to depend on tax advantaged savings accounts (IRAs and 401(k) plans) for their retirement.

How much do you need to save now so that you will have a million dollars when you retire? Let's find out.

One of the formulas you learned in Chapter 14 was the compound interest formula: FV = PV (1+r)ⁿ. But this formula only tells you what the future value of an amount invested today will become in "n" number of years.

But you, being a good saver, will put away an amount every month until you retire. How much do you need to save every month to have $1,000,000 at age 67?

See if you can find out what that monthly amount would be for you.

Assume you will retire at age 67.

Use your current age.

Assume a 5% return on investment.

Assume a 3% inflation rate.

Tell me how much you will need to save each month.

There are many retirement calculators online.

Tell me which calculator you are using.

You can make up numbers if the calculator asks you for other information.